Land use decisions and environmental policy performance: Structural modeling of the Brazilian agricultural system for spatially explicit policy analysis at the forest frontier

Thesis abstract

Brazil is a major producer of farming commodities and host of important biomes. At the same time it faces challenges to balance the provision of benefits from agricultural and ecological systems. Sound environmental policies can help to find such balance. The research focus on the performance and effects of environmental policies and changing economic conditions into farming productivity and land use decisions in the Brazilian Legal Amazon. In this research, the instruments analyse are meant to deter deforestation and, in the South American country, are mostly of command-and-control (C&C) type. One objective is to analyze in the region of study the extent in which C&C instruments affect major crops’ and livestock’s productivity. Another objective is to simulate impacts of increasing international demands for Brazilian farming commodities on land use choices given current policy environment. The results from the modelling and the simulations will be used to identify tradeoffs between the production of farming commodities and preservation of ecosystems. The analysis is based in a structural economic model of agricultural production. The results of the model will produce a baseline scenario that compare effects on the agricultural system when subject to changes in environmental policies or agricultural commodities demanded. Comparisons will look into changes in land use choices, profitability, inputs demanded and outputs produced in agribusinesses of the region. Finally, the results of the economic model are translated into impacts on deforestation and related ecosystem services (ESS). This opens a window for interdisciplinary research by using the results from the economic analysis with those from a bio-physical model.